Your thoughts on the current market?

[vanillafudgecake]

Evening all,

We have been thinking about moving for a while but given the current situation in the market of high interest mortgage rates along with property prices not dropping much in our area, we would be sensible to sit it out and wait to see what happens?

Most properties on the market in our area need some level of renovation and labour/materials seem ludicrously expensive right now together with high asking prices which don't seem to take this into account.

We have viewed a few houses (that need modernising) and have made a couple of offers around 10% to 15% below the asking price but vendors are holding out for offers at asking price. A few years ago they would have sold quickly at asking, if not over, but they are not moving so quickly now.

Our position is we would need to sell but have no mortgage and we have a substantial amount in a high interest savings account. So we are very comfortable hence not in a rush and we love our home but equally we would like more space for our family to grow into and the properties we have offered on are in a desirable location that don't come to the market very often.

If one of our current offers was to be accepted we would need to take out a small mortgage (on a high interest rate, gulp!) and along with the cash from selling our home and releasing our savings it would cover the renovations too. This would be our forever home

What would you do in this position?

Interesting mix here of theories that house prices will drop soon and real life current bidding wars. The market it very localised. Most won't take an offer from someone who hasn't sold seriously. It is correct that it is still hard to find maintained and suitable housing in desirable areas. So on that front although clearly still not easy it could be seen as a good time in retrospect to buy if proceedable, which with something to sell you are not. There was an unfortunate thread a few weeks ago where someone was continually missing out on property as their partner believed it was a buyers market and they should be getting a deal. It isn't a buyers market for the type of property they are after if there are bidding wars clearly. I do now expect replies telling us prices will drop significantly next year. Not for the houses in the areas people want imo. Some very confident forcasting going on with little understanding of how unlikely that is

I agree @CountryCob you only have to read these threads to appreciate that good houses in good areas are still as desirable as they ever were and aren’t going to sell for bargain prices. In fact, they still seem to be able to attract buyers offering close to asking price or sometimes even above asking price. I haven’t yet seen one thread where someone is happily saying they have secured a great property at a knock down price. The main impression I’m getting from all these threads is one of stagnation.

It’s all very well certain people banging on about property prices crashing or collapsing, but in reality it’s more accurate to say that prices are slowly falling or stagnating in most areas. I agree that it’s very unlikely that we will see significant reductions in the areas people want; good houses in good locations always attract more interest. You have to understand the property market to understand that fact, and people giving confident opinions about dramatic price reductions across the board don’t seem to recognise the nuances.

I do classify it as a Buyers market but that doesn’t mean buyers will necessarily get a significant reduction on price, as the OP & their partner on that other thread were finding.

@Twiglets1 my experience has been exactly that - there’s a dearth of attractive properties but when a well-renovated one comes up at a decent price it goes under offer straight away. One thing I think has really shifted in the past couple of years is the general appetite to take on extensive home improvements - with a stagnant market and the rocketing cost of materials/labour it no longer feels like a no brainer and therefore worth the risk and stress.

@ibelieveinmirrorballs being a year into a significant rennovation I agree it is something to be very cautious about. It does make me wonder how the properties which need it will fare in the future. Newer houses often aren't as attractive in scale or location. There is 0 chance I would rennovate to sell in this market

@CountryCob I’m very scarred by my last renovation so I feel your pain! Selling renovated Victorian and moving to an already renovated Georgian house and hoping never to have to renovate again.

Such a good point about the fate of those houses that need the TLC. I’m also very wary of newer properties as they’re subject to looking very “last year” as soon as newer ones are built.

Yes I’ve notified that from these threads. People are less willing now to take on big projects and those that do often seem to regret it in terms of the costs spiralling way beyond the original estimates.

It’s far more risky to take on a project now, especially if the main goal is to make money on it. Houses that need significant renovations are ones that are likely to languish on the market for a long time. And maybe attract a big price reduction in the end, though I still wouldn’t want to take the risk, personally.

My last lot of building work nearly broke me - I think renovations are great if you’re very cash-rich, can afford a project manager and/or architect, and therefore able to employ very high end builders. But for most of us who are trying to get good value by doing some of those things ourselves, whilst living in, whilst working full-time etc etc - unbelievably stressful. I hope never to have to experience it again.

Projects were profitable more so because the market was going up during the many months it would take to finish it. Adding increased renovation cost, house less than ready to move in are setting on the markets for months, and for a good reason, they make no financial sense versus renovated. Until sellers start pricing adequately, we ll continue to see this two speed market.

We recently went to see a renovation property that has been on the market for 12 months. It is on a great road but hugely over priced given the work that needs doing. EA seemed motivated to get it sold - but once we started talking numbers it transpired that “the vendors being willing to be realistic on price” meant they would consider a 2.5% reduction. Even with a 10% reduction, the house + work needed (not to a fancy standard) would be at the ceiling price for the road.

i’ll be interested to see if it sells in the next 6 months.

I’ve also just sold a probate property that needs less but still a lot of work, also on a very desirable road. We completed within 6 months of listing because we were sensible about price. We sold for about 8% under asking following survey. Our buyers got a good deal and so did we in a tough market. Our EAs also worked hard for us because they knew we were serious about getting it sold.

Agree with lots of PPs that the market is nuanced and sweeping generalisations are pointless. But I do think if your house is in a good location but needs lots of work and hasn’t sold in a year, then the problem is usually the price.

I think we will probably end up moving to a renovated house for the first time ever if the market doesn’t correct in the next 18 months or so because I am not interested in paying a premium to live in a building site for six months doing all the maintenance previous owners didn’t bother with.

I also think that the pressure on tradesmen is enormous right now. I have a really good one, who I trust implicitly to do a superb job, but I can't take him to the location where we want to move because his wife is ill and so his range is limited. Finding the people to do the work you need is on a wing and a prayer. Plus, we're thinking about doing it in another language.

I may be delusional, but as the owner of a very spacious 1970s split level with an awesome river view, built by a builder for his family, that we have upgraded and modernised, I can tell you that there isn't another like it in our village. One house, next door, has changed hands twice in 25 years. The other side moved in before us, and they are going nowhere soon. I love the house, but I would like to live closer to my family and friends in retirement, which means moving north of the M4.

Sorry, last two posts are contradictory. We shall either move overseas or north of the M4. We haven't decided.

Thanks for your input everyone.

We are in such a fortunate position that it would be a shame to undo all the hard work we have put in to be in this situation.

We have a lovely home that is to our taste and finished and whilst we would like to move to a bigger home it is a want more than need.

So for now we will sit tight and see how the landscape looks next year.

In surprise you are even being allowed to look around houses if you haven't already got your house on the market or have sold it. Estate agents won't even consider you as a buyer around here unless this is the case. We even had to prove that we had sold to one.

I'd wait until you feel you are in a position to sell, it maybe be worth waiting until the new year and see how things go anyway.

I saw something interesting today as I looked at Rightmove for the first time in ages, because DH thought a house we'd viewed, which then went under offer, was back on the market. It wasn't, but what I did see was a house that was for sale in late spring / early summer back on the market. Not because the sale has fallen through, but because the previous buyer is selling it on already.

It was a repossession when sold before (they announced the offer they'd received for it and it stayed listed until exchange) and the offer was slightly over the asking price (which I'd already judged to be rather optimistic given the work needed). It's now listed at less than they bought it for, having been reduced, with absolutely no work having been done on it.

The doer-uppers are the ones sitting on the market and really struggle to shift because purchase price + renovation cost = tens of thousands above done up price. It makes no mathematical sense to buy them (even if you're in it for the long haul, IMO). As that seller clearly discovered.

We bought a house earlier this year that just needed cosmetic work, nothing major. The expense has taken me by surprise. I hadn't appreciated the cost of decorating a house because we did our last one a little bit at a time. This place looked tired and grubby everywhere!

Some people won't let you view their property until you have an offer - I entirely agree with this.

If you don't absolutely need to move then I would stay in your current house until the market normalises.